California’s governor, Jerry Brown, just signed a bill into law that might have a major impact on commercial transactions not just in the state but also across countries. The bill, AB129, legalizes the use of Bitcoins and other digital currencies in California.
Before June 30, when this bill was signed, the use of Bitcoins was illegal in California. In most other countries, it is illegal. The cryptocurrency suffered a great backlash this year, especially after Mt Gox, a troubled Bitcoin exchange, filed for bankruptcy protection in February this year. Since then, many governments have cracked down on Bitcoins, the most recent incident being in China, where two national banks and Tenpay banned cryptocurrencies.
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However, Bitcoin has found support recently from the likes of Apple, Google and Yahoo. Apple re-introduced Bitcoin apps in its stores following its new policy on online currencies. Google and Yahoo also moved towards recognizing Bitcoin as a valid currency when they started displaying Bitcoin prices in their networks.
Democratic Assemblyman of California, Roger Dickinson, who wrote the bill legalizing Bitcoin, said to DailyFinance : “In an era of evolving payment methods, from Amazon coins to Starbucks stars, it is impractical to ignore the growing use of cash alternatives”.
The significance of AB129 is huge, since California is the most populous state in the United States, and has a great influence on the economy of the country, as also that of the world.
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TIME says : “While bitcoin use is now legal in California, it is not technically legal tender, a status reserved for and defined federally as “United States coins and currency” under the Coinage Act of 1965. The IRS clarified in March that bitcoin functions more like property than currency, which means that taxes applying to property transactions also apply to bitcoin transactions.”
Forbes says : “Bitcoin has now attracted national retailers and service providers, regulators, consumer complaints and now has gotten its very own scam. Retailers, I think we can call this a legitimate consumer trend.”
Guardian Liberty Voice says : “Bitcoins are still experiencing a rise in value following the recent legalization of the digital currency in California. With their various appeals and limited regulations, it is evident virtual transactions are paving the road towards a society which discontinues the use of paper currency completely.”
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